Press release on initiation of investigation procedure for competition infringement against business enterprises Fresenius Medical Care Srbija d.o.o. and Medicon d.o.o.

Commission for Protection of Competition initiated investigation procedure ex officio for infringement of competition, against business enterprises Fresenius Medical Care Srbija d.o.o. and Medicon d.o.o. and their specialized hospitals for hemodialysis, in order to investigate the existence of restrictive agreement under Article 10 of the Law on Protection of Competition, which restricts competition in the market for dialysis services in the Republic of Serbia.

Fresenius Medical Care Srbija d.o.o. and Medicon d.o.o. and their specialized hospitals for hemodialysis are, according to available information, the only private medical centers that can offer the provision of hemodialysis services in the Republic of Serbia for persons insured under the Republic Health Insurance Fund, for which there are no facilities for treatment in medical institutions provided by NHIF Network Plan. At one time, the above business enterprises submitted joint tenders in public procurements for the provision of hemodialysis, which completely excluded competition between these market participants. After the cessation of joint participation, these companies have submitted separate bids, but the specific facts and circumstances indicate that they continued to coordinate their participation in public procurements, which, if confirmed in the investigation procedure, constitutes a restriction of competition in the relevant market. Based on the above, Commission has reasonably assumed the existence of infringement of competition on the ground of consorted practice concerning participation in public procurements conducted by the Republic Health Insurance Fund for provision of dialysis services to persons insured under RHIF.

Commission shall, in investigation procedure, undertake evidentiary actions in order to determine decisive facts, which are important for assessing the existence of infringement of competition.

As always, Commission again pointed out that detecting and sanctioning cartels, especially bid regging in public procurements, is a priority in the work of the Commission on the grounds that this type of restrictive agreements is the most serious infringement of competition, which exclude all the benefits from competitive bidding in the market, increase the spending of budet funds of institutions that regulate public procurements and limit the choice of products/services.

The Commission takes this opportunity to draw attention to all market participants to the legal possibility to be exempted from payment of fine as merger remedy (which amounts up to 10% of total turnover), i.e. that the same be reduced, if they report to Commission existing agreements and/or provide evidence that will enable the issuing of decision on infringement of competition under Article 10 of the Law. The ”immunity” programme is regulated by Article 69 of the Law on Protection of Competition and relevant by-laws (Regulation and Guidelines of the Commission) published on the Commission’s Internet site www.kzk.gov.rs.

In the course of the past week, Commission initiated procedure for establishment of existence of infringement of competition relating to distribution of electronic cigarettes and liquid for electronic cigarettes, and on the strength of its legal powers carried out dawn raids of the premises of the parties on several locations in the territory of the city of Beograde. Procedures were initiated on the ground of suspicion that the undertakings concluded agreements on setting minimum prices in retail trade.

Dawn raid is an unannounced search of premises, i.e.data, documents and effects found in that place, of which a party i.e. holder of premises and property is informed on the spot, at the time of carrying out the search. This instrument is exceptionally efficient in uncovering cartel collusions and other forms of infringements of competition. During dawn raid, Commission had a full cooperation of parties to procedure.

The result of efficient implementation of policy preventing competition infringements is, above all, consumers welfare, through better selection, quality and lower prices of goods and services. Efficient competition policy provides also benefits for competitors, since by preventing cartels and abuse of dominant position, equal conditions for all undertakings are created.

At this instant, Commission is not in position to deliver any additional information, as not to endanger further investigation procedures.